Sunday, January 3, 2016

2016 Financial Goals


I'm a thrifty person.  I buy all of my clothes and as many items as I can from the thrift store instead of departments stores.  I watch every penny that goes in and out of our accounts.  I pride myself on being able to balance our bank accounts, and that the only debt we have is my husband's student loans.= and some very small intentional credit building loans.


At the beginning of last year and all the way until July, Aaron and I were on the perfect road for financial recovery.  I had not only rebuilt our savings but had more than we'd had in years. Aaron's student loans were actively being paid off. I was building credit.  All was well!

And then we unexpectedly had to move.

Twice.

Moving is extremely expensive.  Even if you find volunteer help for the actual act of shifting furniture and boxes from one living space to another, renting comes with deposits, some of which are non-refundable no matter how long or little you live there.  We spent $400 at the Witchy Cottage on pets, and they still took $200 out of our own deposit for steam cleaning specifically. Not because our carpet looked bad but because the steam cleaning was required by the state because we owned animals.  I get that, but my pets didn't do $400 worth of damage to the house otherwise.  In fact, they did exactly $0. So why take the steam cleaning out of our refundable portion of our deposit instead of using the pet deposit for it?

Or how about the 30 day house, where I spent $600 for the pets and we only lived there for a month.  Legally, I could not get that money back. We signed it away when we thought we were signing to live there for a year or longer.  It didn't matter that it was only a month.  And then I had to spend the non-refundable pet deposit again for Terra Luna.

Pets are a money sinkhole for rental properties, I swear.  Not that I would ever have it any other way.


Of course, all this disregards any other deposits, refundable or otherwise, that I had to put down.  All-in-all, Terra Luna cost us $2600 in one day just to get the key. As outrageous as it sounds, all of this is normal and legal and it's just the way things go.  It's the reality of renting.  Until we can pay off some of my husband's student loans, that's all we can do as of right now.

I digress.  Here's the chart:


In 2014, we had a lot of financial struggle from, you guessed it, moving.  However, it took the help of others to pull us out of the brinks. At the start of 2015, I estimated my happiness with our finances at just 25%.

This year, I'm proud to say that we handed not one but two emergency moves like champs.  We covered the costs and did what we had to do.  There have been some little things along the way, like my husband's car deciding not to start in November and costing us about a grand, that we've also been able to absorb and still stay on our feet.  We're not in danger of falling, but we're not moving forward.  So I'm definitely happier with our finances, but still not where I want to be by any means.  I think 38% is accurate.  That leaves me with six goals for 2016.


The Pentacle Chart does not offer a "financial" section, but many of the goals, such as budgeting and retirement options, fall directly into the financial area.  That being said, here are my 2016 financial goals!

Maintain Budget

"While I had a budget for 2014, the thing about moving is that your bills suddenly change," I wrote last year.  I hate that I'm keeping that line in this post because it means we moved again and, yet again, things have changed.  Fortunately, my budget for 2015 is set up to deal with this.  All we really had to do was plug in new numbers and re-run the calculations.  Now, we just have to maintain it. Simple enough, hopefully, given that we don't have to move again.



Target Areas for Improvement

We added some financial weight this year.  We no longer have a roommate, which means we have to compensate for his portion of the rent.  While we've been paying his portion since February 2015, it was meant to be a temporary situation that we pulled from savings and replenished when he found a job.  Now, it's permanent.

In addition, because we had such sudden moves that required quick action, we had to put a range on rent instead of staying at or below where we was.  We don't pay much more for Terra Luna than the Witchy cottage, but it is a tiny bit more.  Kind of like adding salt to the wound, really.

Our budget definitely doesn't have the same wiggle room it once did given the circumstances.  While we absolutely know we can cover it because we've been doing it for almost a year already, it's time to target areas that could use some work so we can really, actually save and move forward financially.

I took a look at our budget and found some key areas I want to work on paring down.  For example, because of my condition, our food budget is astronomical.  I just threw a number out that I knew would give us the working room we needed.  This year, I'd like to find out just exactly how much we're spending and find ways we can shrink that budget to maybe even half of what it currently is while still staying on the diet my body needs.  And that's just one area.  I often allot for a high electricity bill because I work from home, my computer rarely turns off and I'm sometimes up late at night for deadlines.  So I know there are ways we can cull our budget so that more money flows towards savings and loans.  Each month, I want to target one area and shrink it as much as I can without interrupting my work or my health or so forth.  Here's my plan:




Rebuild Medical Savings

I have something called Multiple Autoimmune Syndrome, which is like non-lupus lupus.  It's a real pain.  While we have health insurance and most of our direct medical expenses are covered, health insurance doesn't cover things like extensive time taken off work and extra life costs, such as raising the thermostat or needing very specific and sometimes expensive foods, that are sometimes associated with having a flare up.

When we moved the first time this year, the money we used came from our usual savings.  That was fine.  That was something we could rebuild once we'd settled.  But we never got a chance.  When we moved the second time, I had to pull a little money from medical savings, but we were still okay.  Then car troubles and health troubles took their toll and, well... my medical savings has been halved.

Rebuilding my medical savings is more than doable this year.  It's just something I have to get on top of.  While I still have enough savings that we're covered should something happen with my health, it's not enough to cover me for several months of being out of work and such.  With that in mind, I need to personally put away $175 per month to rebuild my medical savings come January 2017.  I think this is actually very feasible after looking at our budget.


Pay off 1/2 of my Husband's Chase Student Loan

Last year, I had wanted to pay off the Chase loan in full.  A private loan with a ridiculous 13.5% interest, we actually chipped away at it really well!  But then we moved and had to put the extra payments on hold.  I realize that rebuilding my medical savings and paying off this particular loan in full may be too much of a burden on our budget, but I think getting it half-paid is more than doable.  To do that, my husband will need to pay an additional $330 a month directly to principal balance.  My husband also thinks he could add an additional $110 per month directly to the principal balance of some other smaller federal loans, but I'm not making that an inked goal. I mostly just care about this silly Chase loan right now.  At the end of the year, if we have any additional savings, that loan is getting a chunk of cash so that we can maybe officially say goodbye to it at some point and time.


Research Retirement Options

I wanted to do this last year, but I actually got off track before I even moved.  It seems hard to plan for retirement when so many other things have my attention but, gosh, do I know I need to do it.  There's no 401k for me as a freelancer, so I need to start my investments now before it's too late!

The first thing I need to do is talk to my bank to see what options are out there for me.  Then, as soon as I have it, I need to throw some money into some funds.  I can spend the rest of the year idly researching my options and, once I know where we're at in December, I can start actually investing in my retirement.  I still want to keep this fairly open and low pressure even though I'm deeply aware of how important it is that I start now, but I think keeping it low pressure will actually ensure I do it.

So let's put it all together:

Financial Goals - 0% Complete for the month.
(Pictures and some notes on this month's progress)

Maintain a Budget [x/30 (or 31 or 29) days]. – 0% complete
Target Areas for Improvement [Specific monthly goal]. – 0% complete.
Rebuild Medical Savings  [x/$175 per month]. – 0% complete.
Pay off 1/2 of the Chase Loan [x/$330 per month]. – 0% complete.
Research Retirement Options [Specific monthly goal]. – 0% complete.

Coming up:
2016 Health Goals

To my audience:
What are your financial goals for 2016?

4 comments:

  1. I wish you guys the best of luck! I hated renting for all the reasons you mentioned. That's why we pushed to buy a house last year despite not being ready. I'm not sure how much your husband has in student loans, but between me and my husband we have a lot. We still managed to purchase our first home at 3% down ($3900). I know most people say to put as much as you can down, but honestly, buying this house was the best thing we have ever done financially. I'm not saying you should push it if you aren't comfortable, but there are a hell of a lot of options available for new home buyers. Tax write offs, assistance programs, etc. We are paying $200 less a month for our mortgage (with taxes, insurance, and everything) than we paid for rent at a house with no yard, a really awful leasing company and owner, and in a bad part of town where my car was stolen forcing us to purchase a new one. Because we moved, our insurance drastically decreased on our cars (cut in half!) and our utilities are a quarter what they were at our old place. On top of it all, each month we build equity. I can't even begin to tell you how much happier we are. We just finished putting in all new laminate wood floors throughout the entire house, something we would never have been able to afford prior to purchasing this home. We are in such a better place, especially once I find a teaching job this spring. I wish you both the best of luck and keep pushing. Don't think something is out of your reach because you have student loans.

    As for saving on your groceries, you should shop at Aldi if you have one. Super cheap and tons of options. You just have to be prepared. It is very different from shopping at a "normal" grocery store. I can't remember if it were you or not but they have tons of gluten free products too along with organic products. I spend an average of $200 less a month shopping there than I did anywhere else.

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    1. It certainly sounds wonderful, but with the amount of debt my husband currently has and my lack of credit history (just one year currently), mortgage companies really aren't even looking at us right now. We thought about buying a house in 2012, but were pretty much shot down at every turn. Given that experience, we have a five year projected plan to get us into a house. Where we're living right now is actually really nice. We had a frozen water pipe yesterday and the rental company ensured it was fixed as soon as possible. And, honestly, I just don't want to move for a while. I've moved every year since 2008 with twice being this year. If we could just resign this lease, I'd be a happy camper.

      I gave Aldi an attempt back in 2013 or so, but it was a bad experience. One time I walked in and the only meat they had was pork. There were gnats swarming the bananas which were totally rotten. Aldis in other locations may not be as bad, but ours is pretty awful. That being said, there are a lot of other local grocer options that I'd like to try out, so I'm sure I'll find something!

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  2. I can really relate to your renting issues! In Australia, there's nothing like a pet surcharge. It's up to individual landlords to decide if they will allow pets. Invariably they don't, so people have to wait until they can buy their own house to have a pet. It's a really sad situation.

    I second the advice about Aldi. There was a survey done here last year and Aldi came out as being half the cost of the other major supermarkets. The gluten-free bread is pretty good, in my opinion.
    Good luck with everything!
    xx Katie.

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    1. I'm so sad to hear that! I couldn't imagine not having my furbabies. Here in the US, the usual max for renting is two pets, so we often struggle to find places that will accept all four. But that's been the worst-case scenario for us.

      I had a really bad series of experiences with our local Aldi, so I don't know if shopping there will be an option for us. That being said, we have a lot of local grocery stores I'd like to try.

      Thank you so much, Katie!

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